Must do better: the Office for Students and the looming crisis facing higher education Contents

Chapter 4: Value for money

140.HERA requires that in performing its functions, the OfS must have regard to “the need to promote value for money in the provision of higher education by English higher education providers”. HERA also requires the OfS to have regard to “the need to promote quality, and greater choice and opportunities for students”.166

Student outcomes

141.The OfS explained that it evaluates value for money through survey results of undergraduate students in relation to both value for money and quality of education, as well as through “student outcomes indicators”, which include whether students continue beyond their first year of study, whether they complete their course, and whether they have positive graduate outcomes after their studies.167

142.The OfS often describes its work on student outcomes in relation to “quality and standards”, explaining that in 2022, the regulator introduced strengthened conditions of registration to allow it to take “robust action” where courses fall below its expectations. In particular, condition B3 requires each provider “to deliver positive outcomes for its students, including in the extent to which students continue on and complete their course, and progress to professional employment or further study”.168

143.The OfS argues that regulating outcomes in this way is “a consumer protection mechanism for students and assurance for taxpayers”. The OfS is currently undertaking “the first cycle of assessments” relating to the condition, selecting providers that have continuation, completion or progression rates below its numerical thresholds.169

144.Dame Nicola Dandridge, the former Chief Executive of the OfS, said that the regulator looked at value for money from the student and taxpayer perspective, “because there is still a lot of subsidy” in the higher education system.170 Higher education is subsidised through the student loan system to the extent that student loans are not repaid. The Government expects that around 20% of full-time undergraduate students starting in 2021–22 will repay their loans in full, although this is forecast to increase to 55 per cent among new students from 2023–24 following reforms to how student loans are repaid.171

145.Dame Nicola explained that condition B3 looks at graduate outcomes 15 months after graduates leave their course, with “an expectation that a certain proportion will go into graduate jobs”. She argued that some providers “do very well on this and some do not”, with the OfS investigating business and management courses, “where there is huge diversity” in outcomes “to quite an alarming degree”.172

146.Lord Johnson, the former Minister for Universities, said that the OfS tries to assess value for money through proxies as it cannot be measured directly, but noted that “inevitably, those proxies are not perfect”. He emphasised the need not to “get too depressed” about value for money, as the graduate salary premium is “robust over time, suggesting that real value is added”.

147.Several witnesses argued that value for money was difficult to measure. Martha Longdon, a former Chair of the OfS’ Student Panel, said that value for money “is incredibly hard to measure” because it “will differ from student to student”. She said that what constitutes value to an 18-year-old undergraduate “just wanting to have a social life and be part of that experience” will be “very different” to someone “pursuing an MBA because they have very clear aspirations”.173

148.Martha Longdon argued that the OfS’ approach is not “sufficiently understanding of those different nuances” and that “there has not been enough effort to try because it does not align with the Government’s steer”, which emphasises the importance of jobs and pay.174

149.Professor Neal Juster of the University of Lincoln argued that even if one could know the counterfactual outcome for a graduate if they had not undertaken higher education, “it would take 20 or 30 years before you worked out whether it was value for money”.175 Similarly, the Cathedrals Group of Universities suggested that achievement of a graduate job may take longer than “the 15-month timeframe currently used”.176

150.Vivienne Stern of Universities UK said that the OfS’ indicators are “absolutely influencing provider behaviour”, which “is positive”. However, she disagreed with the idea that “value equals getting a good job with a high salary”, arguing that “students and graduates also value things such as social contribution, the impact on communities, public service and contribution to culture”.177

151.Lord Johnson warned against the idea of equating value for money with the proportion of a student loan that is repaid, arguing that this would risk “the diversity and breadth of subjects offered” and could generate skills shortages in “lower-earning career paths that are of great social value”.178

152.The Royal Academy of Engineering, the Engineering Professors’ Council and the Engineering Council expressed concern that because the OfS uses graduate outcomes as a metric, courses with higher numbers of disabled students, care leavers and students from lower socioeconomic or ethnic minority backgrounds “might look ‘low quality’ while actually the prospects of those students … have been greatly improved”. They argued that “trying to do the right thing may open universities up to sanctions” and this direction of travel “is therefore likely to narrow fair access, rather than improve higher education”.179

153.Alex Proudfoot of Independent Higher Education argued that “the OfS worships at the altar of the gods of data”. He said that the student outcomes data relies on the Office for National Statistics’ (ONS) Standard Occupational Classification (SOC) codes to identify graduate jobs. He pointed to Norland College as an example of difficulties with this approach. He said that Norland College “trains the world’s best nannies” and “almost 99%” of its graduates get “the exact job they want to get” but added: “because the SOC code for nannies … classes them as unskilled, they look as if they are failing to the OfS”. He said this was “unacceptable”.180

154.Chloe Field of the National Union of Students (NUS) argued that students face “an arbitrary price” and “cannot move easily in this market”, meaning that questioning whether students are “getting a monetary value” for their courses “is just not how it should work”.181

155.Francesco Masala, a former member of the OfS Student Panel, said that the Panel “raised multiple times” that value for money “should involve an element of broader student life outside the classroom”.182 Vanessa Wilson suggested that the value added by higher education “would have been a positive, progressive area to look at”, demonstrating the value of the sector in “educating disadvantaged students and bringing them up to the same levels”.183

156.The Fair Access Coalition agreed on the need to “consider the specific circumstances of students being brought in” by focusing on “student progress as an outcome” rather than “the ability of students to enter specific kinds of employment sectors”.184 The Mixed Economy Group of Colleges and the Social Market Foundation (SMF) called for a greater focus on “learning gain” and the value added by higher education, which the SMF argued shifts away “from evaluating providers based on outcomes outside their control … and towards what they are constituted to do”.185 Universities UK called for a broader set of approaches to value for money including learning gain, graduate views of career progression, support for economic growth and social impact.186

157.Susan Lapworth said that the OfS treats “quite a wide range of outcomes as positive” for graduates and emphasised that “salaries are not driving this part of our regulation”.187

158.Susan Lapworth said that the student outcomes indicators are “relatively simple” and “set a minimum floor below which performance will start to attract regulatory attention”. She stressed that the OfS will “always go to the provider and have quite an in-depth conversation about the context”, arguing that “this is not a blunt, data-only approach”.188

159.The Minister said that “value for money is incredibly important” and it “must be about outcomes and jobs with good skills and progression. Otherwise … what is the point of spending all that time at university and taking out the loan?”. He noted that “there is good evidence that suggests that the higher education system is preparing students for high-quality employment” but emphasised that “a lot more has to be done to tackle pockets of poor quality that persist”.189

160.In its July 2023 response to its higher education policy statement and reform consultation, the Government announced what it described as a “crackdown on rip-off university degrees”.190 Specifically, it would issue statutory guidance to the OfS setting out that it should impose recruitment limits where provision is found to be in breach of the B3 condition. This would aim to “prevent the growth of provision which is not delivering positive student outcomes” and in extremis could include preventing any recruitment to such courses. The Government also indicated that it would ask the OfS to consider earnings data as part of its quality regime.191

161.The OfS’ regulatory framework already allows it to impose specific ongoing conditions on providers, referencing a scenario where it could “require the provider to improve its employment outcomes before it can increase the numbers of students it recruits”. The regulatory framework also suggests that suspending a provider’s registration may be appropriate “where a particular course has very weak continuation rates or with few students progressing to managerial or professional employment, or further study”.192 In one previous case, the OfS has already restricted the number of students at a provider and prohibited it from offering new courses due to concerns over student outcomes.193

162.Given the financial cost of higher education to students, we welcome that the OfS is focused on ensuring their courses are of sufficient value and lead to positive outcomes. It is likely that this has already had some impact in focusing institutions on improving provision.

163.Value for money in the context of higher education is a subjective concept and is difficult to measure. However, the proxies used by the OfS to indicate positive outcomes, particularly in relation to continuation and completion of courses and graduate outcomes, are simplistic, narrow and fail to reflect the broad value of the higher education experience and the skills needed for the future.

164.The OfS’ proxies also hold providers accountable for their students’ subsequent employment outcomes, which are often affected by many factors outside the providers’ control, such as students’ backgrounds. Focusing too heavily on regulating according to these outcomes has the potential to run counter to efforts to widen access to university, both by penalising institutions that take on students from disadvantaged backgrounds and by underplaying the benefits of courses that are less directly vocational.

165.The OfS should conduct and publish further work to assess the broader value of the higher education experience, particularly for those from disadvantaged backgrounds. This should involve looking at the potential to measure the wider value added by higher education, as well as the outcomes that follow it. This work must be done in collaboration with stakeholders across the sector, including students.

Student information

Information provided by institutions

166.Dame Nicola Dandridge highlighted that alongside ensuring high quality, the OfS’ responsibility in terms of value for money was to ensure “that their consumer rights were protected and that there was transparency in what they would be offered”. She said that the OfS model “is premised on student choice” but that this only works if they can make an informed decision.194

167.Vivienne Stern argued that “if students have access to good information, they should be able to choose for themselves”, and criticised a tendency towards “denigrating the choice of an individual student because they do not think that what the student is doing will end up being valuable”.195

168.Chloe Field suggested that the information available to prospective students “differs from institution to institution” and “is definitely something that universities struggle with”. She suggested that the biggest transparency issue faced by students is hidden course costs, such as expensive textbooks.196 Francesco Masala explained that he had done work at his university on providing transparent information on average student weekly living costs. He added that students were more likely to drop out of their studies if they “cannot cope with the cost of living”, rather than because of tuition fees.197

169.Mack Marshall, Education Officer at Newcastle University Students’ Union, cited research that in terms of value for money, students want “transparency and clarity as to where their £9,250 goes”. He said that students are “vulnerable consumers” making “one of the biggest financial transactions” of their lives, and that it is “really tricky” to say whether students get value for money as they “do not have that minimum baseline … to judge value for money against”. He argued that it would be useful for the OfS “to tell students what their rights are” as part of that baseline.198

170.Martha Longdon argued that both providers and students being clear on what to expect from courses is “really important”, but that she “would hate to see a situation where that information is so prescriptive that providers cannot make positive changes”.199

171.On 31 May 2023, the Competition and Markets Authority published an update to its consumer law advice for higher education providers. The advice sets out the CMA’s view of the minimum requirements for compliance with consumer protection law in this area. This includes ensuring that students are given “up front, clear, timely, accurate and comprehensive information” on the structure of courses, fees and costs before a decision is made about which courses and providers to apply to.200

Contact hours

172.Dame Nicola Dandridge said that when she engaged with students, “it came up again and again that students did not feel like they were getting enough support, advice and … contact hours”.201 Chloe Field said that “contact time is vital”.202 Martha Longdon said that “lots of students” value contact time and see that “as the only thing that they are paying for”.203

173.Dame Nicola explained that the OfS saw this as “a question not just of quantity but of quality”, arguing that “it would be wrong to see contact hours as equating to high quality”.204 Chloe Field also emphasised the importance of “quality contact time”, including one on one time to discuss concerns as well as lectures. 205

174.Martha Longdon said that “it is not clear to what extent those fees are also paying for the broader infrastructure”, such as facilities and libraries, although “there are universities that have tried to articulate this”.206 Chloe Field said that transparency on contact hours has not been “a massive issue that students bring up” and that the biggest issue is “whether the staff are able to provide those contact hours”.207

175.Rania Regaieg, President of the Students’ Union at the University of the West of England, said that it “would have been great” to know what to expect, but similarly argued that it “is not particularly necessary to know the exact number of contact hours”, suggesting that it is more important “to know that I will have a good, holistic student experience”.208

176.Mack Marshall said that industrial action is currently a key concern of students and that the current marking and assessment boycott is causing “a lot of student anxiety”. He suggested that it would be “really useful” for the OfS to clarify “what students’ rights are” in these situations.209 Chloe Field said that rather than transparency on contact hours, the “biggest issue” is whether staff are able to provide quality contact hours, stressing that higher education staff are “overworked” and on “very precarious contracts”.210 The University and College Union (UCU) said that the increasing casualisation of teaching staff in higher education is “having a significant impact on the quality of the student experience” and is “worthy of further investigation by the OfS”.211

177.Some concerns were raised around the value of online learning. Charles Clarke said that some institutions during the pandemic “thought that online learning was basically having a camera on the lecturer”, leading to some “very unsatisfactory experiences”. However, he added that more broadly, online learning can be “potentially very positive” by reaching out to a wider student body.212 Dame Nicola Dandridge said that the OfS had been “concerned about the quality” of some online provision during the pandemic, while Anthony McClaran of GuildHE said that it is possible for online learning to provide a fulfilling education but “it needs to be thought about seriously”.213

178.For the OfS, Lord Wharton said that “students get a lot of information” but questioned “whether it is as easily digestible as it ought to be”. He stressed that “there is a significant power imbalance” between providers and students that “does not always lead to the best outcomes for students”. He said that the OfS has piggybacked on the CMA’s work on student information and consumer protection but “more could be done”, as currently “it is a fairly soft regulatory requirement”.214

179.Lord Wharton explained that the OfS undertook a blended learning review during the pandemic, allowing the regulator to issue best-practice recommendations to institutions. He argued that “there are quite a lot of shades of grey” but that “a certain approach to blended learning can add value”.215

180.Susan Lapworth expressed concern that students “can be a bit lost” in all of the information they get and explained that the OfS contributes “to providing some clarity”, including through its Discover Uni website, which publishes “impartial information about providers and courses”.216

181.Susan Lapworth also outlined that the OfS expects providers to “be as transparent as possible” about what students can expect from their course, including on contact hours and the extent to which courses are delivered online or in person, but “there is quite a lot of variability in the quality and detail” of this information. She argued that this is “not helpful to students making those tricky choices” and explained that the OfS is “keen to do more work on this area”.217

182.The Minister agreed that the information given to students “is mixed” and “some universities do not give enough information”. He said that this “absolutely has to be a requirement”, especially in relation to the amount of online learning. He stressed that as much information should be put on providers’ websites as possible “so that students know that they are doing and what that university offer is when they apply”.218

183.It is important to remember that going to university is a very significant financial commitment to make at any time, let alone as a young person. It is therefore imperative that students are given clear, accessible information on what they can expect as part of their course.

184.We heard that the information provided by higher education institutions can differ greatly in this respect and that it is not clear to students what their rights are or what they can expect from their courses. This lack of transparency is unacceptable given the level of financial commitment involved.

185.The OfS should ensure that when prospective students apply for a course, they receive clear, digestible general information on the approximate contact hours they can expect to receive; the balance between online and in-person learning; the likely cost of living as a student on the course as it is running, including accommodation and hidden course costs; and the potential costs of student loan repayments over time for those on average graduate earnings. The OfS should hold providers to account for delivering this information, and should consider tougher regulatory consequences for those that do not. The OfS should also ensure that its approach is in alignment with the latest guidance issued by the Competition and Markets Authority on consumer protection.

166 Higher Education and Research Act 2017, section 2

167 Written evidence from the OfS (WOS0001)

168 Ibid.

169 Ibid.

170 Q 5 (Dame Nicola Dandridge)

171 House of Commons Library, ‘Student Loan Statistics’, Research Briefing SN 01079, June 2023

172 Q 16 (Dame Nicola Dandridge)

173 Q 74 (Martha Longdon)

174 Ibid.

175 Q 42 (Professor Neal Juster)

176 Written evidence from the Cathedrals Group of Universities (WOS0022)

177 Q 49 (Vivienne Stern)

178 Q 22 (Lord Johnson of Marylebone)

179 Written evidence from the Royal Academy of Engineering (WOS0044), the Engineering Professors’ Council and the Engineering Council (WOS0048)

180 Q 56 (Alex Proudfoot)

181 Q 65 (Chloe Field)

182 QQ 74–75 (Francesco Masala)

183 Q 49 (Vanessa Wilson)

184 Written evidence from the Fair Access Coalition (WOS0049)

185 Written evidence from the Mixed Economy Group of Colleges (WOS0027) and the Social Market Foundation (WOS0043)

186 Written evidence from Universities UK (WOS0034)

187 Q 119 (Susan Lapworth)

188 Ibid.

189 QQ 132 and 145 (Robert Halfon MP)

190 DfE, ‘Crackdown on rip-off university degrees’ (17 July 2023):

192 OfS, Securing student success: Regulatory framework for higher education in England (24 November 2022): [accessed 17 July 2023]

193 OfS, Burton and South Derbyshire College - Specific ongoing conditions of registration:–3542e9342da5/burton-and-south-derbyshire-college-specific-ongoing-conditions-of-registration-b3a.pdf [accessed 17 July 2023]

194 QQ 5 and 16 (Dame Nicola Dandridge)

195 Q 53 (Vivienne Stern)

196 Q 66 (Chloe Field)

197 Q 76 (Francesco Masala)

198 Q 110 (Mack Marshall)

199 QQ 75–76 (Martha Longdon)

200 Competition and Markets Authority, UK higher education providers - advice on consumer protection law
(31 May 2023): [accessed 13 July 2023]

201 Q 6 (Dame Nicola Dandridge)

202 Q 65 (Chloe Field)

203 Q 75 (Martha Longdon)

204 Q 6 (Dame Nicola Dandridge)

205 Q 65 (Chloe Field)

206 Q 75 (Martha Longdon)

207 Q 65 (Chloe Field)

208 Q 111 (Rania Regaieg)

209 QQ 107 and 109 (Mack Marshall)

210 Q 66 (Chloe Field)

211 Written evidence from the University and College Union (WOS0020)

212 Q 23 (Charles Clarke)

213 Q 2 (Dame Nicola Dandridge) and Q 86 (Anthony McClaran)

214 Q 120 (Lord Wharton of Yarm)

215 Q 115 (Lord Wharton of Yarm)

216 Q 120 (Susan Lapworth)

217 Ibid.

218 Q 145 (Robert Halfon MP)

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